Yahoo! and Advertising: How Big Data is Playing a Big Part

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When we think of the spread of the internet over the past twenty years, the expansion has been phenomenal. The reasons have been given as additional connectivity, increased knowledge and the ability to create effective networks. In reality the reason that the internet has expanded to the size that it has is because it is very easy to monetise.

This is not just done through e-retailers and online shoppers but also through the use of advertising on websites. It has changed the face of publishing forever, meaning that we are seeing newspapers becoming exclusively online and others that are creating more revenue through online advertising than in print. This kind of shift has allowed companies to create marketplaces for selling this web real-estate.

One of the earliest users of this kind of platform was Yahoo!, a web giant that is finding it’s feet again after a few rocky years.

I was in the audience when Eric Bax, Director, Marketplace Design at the company spoke at the Big Data for Marketing Summit in Miami.

In July of 2013 Yahoo! were looking on the up having had more US visitors to their sites than Google sites (according to Comscore). This meant that they must have been doing something right and I was interested to see what Eric had been doing to help with this.

One of the most interesting aspects of site design mentioned by Eric was that advertising holds a key role in how sites are perceived. Ugly ads are going to create ugly sites that people are less likely to come back to.

He gave the analogy of a barn by the side of the road. If it’s just a regular barn people will largely ignore it and it will be forgotten, paint an old Coca Cola ad on the side and the value and beauty of the barn will increase. The theory behind this is seldomly seen on the internet, but it is something that can be achieved.

The idea behind this is that beautiful advertising can entice the audience to a site and this is something that Eric is a big advocate of. He realises that in the short term it can be more profitable to place uglier ads that provide more in PPC, but this may damage the amount of visitors to the sites in the long term.

But what does this have to do with big data?

There are two different ways to submit advertising. The black box method, which essentially allows the site to place the ad where it is likely to get the most clicks, and the more customised version allowing advertisers to target based on categories and demographics. One allows for more information to the advertisers (customised) whilst the other allows Yahoo! to use it’s knowledge of the audience but allows less feedback (black box).

What Big Data allows is to show that X thousand adverts were shown to somebody and how they reacted to these adverts. This goes beyond simple click throughs and investigates their return visits, frequency of visits and behaviour whilst on the site. In Eric’s words ‘We don’t have over 40 servers for nothing’. This powerful analysis means that Yahoo! can place ads that people want to see, meaning their sites are more pleasant for users and ads are more likely to get clicks from users.

This is a win-win for both the advertisers and the website owners, all thanks to the use of big data in the analysis of the ads. It also transcends the issues with both forms of ad submission, creating enough insight to maximise ROI whilst not restricting discovery through tight categorisation.

This kind of use of big data is something that goes beyond the traditional thoughts of data scientists. The use of analytics and data to decipher not only ROI for advertisers, but to also create websites that are likely to increase visits due to their ads is something else completely. This work shows that with lateral thinking and dynamic approaches, big data can truly have beneficial impacts for both those advertising and those who need advertising to monetise.

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